United States General Accounting Office

GAO Testimony

For the Subcommittee on National Security, International

Affairs, and Criminal Justice, Committee on Government

Reform and Oversight, House of Representatives

For Release on Delivery

Expected at 9:00 a.m. EDT

Thursday, September 19, 1996

DRUG CONTROL

U.S. Heroin Control Efforts

in Southeast Asia

Statement for the Record by Jess T. Ford, Associate

Director, International Relations and Trade Issues,

National Security and International Affairs Division

G O A

years

1921 - 1996

GAO/T-NSIAD-96-240

Mr. Chairman and Members of the Subcommittee:

I am pleased to be able to provide this statement for the record on the

results of our review of the production and trafficking of heroin from

Southeast Asia to the United States and current efforts to stop it. The

information in this statement is based primarily on our March 1996 report

entitled, Drug Control: U.S. Heroin Program Encounters Many Obstacles in

Southeast Asia, which was initiated at the request of this subcommittee.1

The statement covers (1) the extent and nature of the heroin threat to the

United States, (2) impediments to successful heroin control efforts in

Southeast Asia, and (3) the efforts of the United Nations Drug Control

Program (UNDCP) in Burma.

Summary of

Observations

Heroin use continues to pose a serious and growing threat to the people of

the United States. The Department of State reported in March 1996 that, in

recent years, worldwide heroin production has risen, the number of heroin

users in the United States has increased, the average purity level of heroin

on the street is significantly higher, and the number of heroin-related

hospital emergency room episodes has climbed. The majority of the heroin

consumed in the United States originates in Southeast Asia, most of which

is produced in Burma.

The U.S. international heroin strategy calls for a regional approach

focused on Southeast Asia and the need to reduce opium production in

Burma as a key to reducing the flow of heroin from the region. However,

stemming the flow of heroin will be difficult because a number of factors

pose substantial difficulties for the United States in establishing effective

counternarcotics programs in Burma. These factors include (1) the lack of

a meaningful U.S. program in Burma, (2) the lack of Burmese government

commitment to drug control efforts, and (3) ineffective U.N. drug control

efforts within Burma. U.S. efforts have achieved some positive results in

certain other Southeast Asian countries and territories, such as in Thailand

and Hong Kong, that have demonstrated the political will to implement

counternarcotics activities. However, problems with Burma limit the

success in the region.

The United States increasingly relies on international organizations, such

as the United Nations, in countries such as Burma where the United States

faces significant obstacles in providing traditional bilateral

1

Drug Control: U.S. Heroin Program Encounters Many Obstacles in Southeast Asia (GAO/NSIAD-96-83,

Mar. 1, 1996).

Page 1 GAO/T-NSIAD-96-240 Drug Control
counternarcotics assistance. The United States has supported UNDCP drug

control projects in Burma, but the projects have not significantly reduced

opium production because (1) the scope of the projects has been too small

to have a substantive impact on opium production, (2) the Burmese

government has not provided sufficient support to ensure project success,

and (3) inadequate planning has reduced project effectiveness.

The Heroin Threat in

the United States Is

Serious and

Increasing

According to recent U.S. government reports, the U.S. heroin addict

population, which had remained stable at about 500,000 persons for nearly

two decades, has risen and is now about 600,000 or higher. The Office of

National Drug Control Policy (ONDCP) estimates that Americans now

consume 10 to 15 metric tons of heroin annually, an increase from the

estimated 5 tons consumed during the mid-1980s.

In comparison with the 1980s, heroin now has an added appeal to users

because it is more potent—containing higher purity levels than in the past.

For example, average purity for retail heroin in 1995 was about 40 percent

compared to about 7 percent a decade ago. As a result of increased purity,

heroin can now be snorted or smoked and the user is freed from the added

threat of contracting AIDS through a contaminated needle. In addition,

there is a reported increase in the number of multiple-drug users who are

using both heroin and crack cocaine.

Source Countries for

Heroin

Opium poppies, from which heroin is derived, are grown primarily in three

regions of the world—Southeast Asia, Southwest Asia, and Mexico and

South America. According to the Department of State, worldwide opium

production has nearly doubled since 1987—increasing from about 2,200 to

nearly 4,200 metric tons in 1995. In 1995, the Southeast Asia region was the

source of approximately 75 percent of the world’s opium poppy cultivation

and 62 percent of the world’s estimated opium production. The bulk of the

remaining cultivation and production occurred in the Southwest Asia

region (primarily Afghanistan), accounting for about 20 percent of

worldwide opium poppy cultivation and over 35 percent of opium

production. Cultivation in the region comprised of Mexico and South

America accounted for only about 5 percent of worldwide opium poppy

cultivation and 3 percent of opium production. Nevertheless, DEA reported

on September 3, 1996, that South America became the predominant source

area for heroin seized in the United States during 1995.

Page 2 GAO/T-NSIAD-96-240 Drug Control
Southeast Asian opium production has increased by about 2-1/2

times—from just under 1,100 metric tons in 1987 to nearly 2,600 metric

tons in 1995. About 87 percent of the opium poppy cultivation and

91 percent of the opium production in Southeast Asia occurred in

Burma—primarily in Burma’s eastern Shan State. (See app. I.) In addition,

the State Department reported that, in 1995, Burma was a major supplier

of heroin to the United States. From its estimated yield of 2,340 metric

tons of opium gum, Burma had the potential to produce an estimated

230 metric tons of heroin—enough to meet U.S. demand many times over.

Efforts to Control Heroin U.S. funding of heroin control efforts accounts for a small portion of the

overall international drug control budget. ONDCP estimated that, during

fiscal year 1994, the United States spent $47.5 million on international

heroin control activities, or about 14 percent of its international narcotics

control budget.

In Burma, Hong Kong, and Thailand, as of June 30, 1996, DEA had a total of

43 permanent staff, while the State Department has 7 staff assigned to its

Narcotics Affairs Section in Thailand and none in Burma or Hong Kong. In

Burma and China—two key countries involved in heroin cultivation,

production, and trafficking—the State Department has no Narcotics

Affairs Sections, while DEA has only three staff—all in Burma. Other U.S.

efforts in the region include intelligence analysis support for U.S. law

enforcement agencies, and equipment and training for host nation

counternarcotics forces provided by the Joint Interagency Task

Force-West, based in California, and the Department of Defense’s Pacific

Command.

Burma Presents

Challenges to U.S.

Heroin Control

Efforts

The U.S. international heroin strategy addresses the worldwide threat but

focuses on Southeast Asia because this region is the primary source and

includes major trafficking routes for heroin imported into the United

States. The strategy places special emphasis on reducing Burmese opium

production as a key to decreasing the regional flow of heroin into the

United States. However, the United States faces the following significant

obstacles in implementing this approach:

• Since 1988, the United States has not provided direct counternarcotics

assistance to Burma because of its record of human rights abuses and its

refusal to yield control of the country to a democratically elected

government.

Page 3 GAO/T-NSIAD-96-240 Drug Control
• Much of Burma’s opium-producing region is not under the effective

control of the Burmese government.

• Due to unique trafficking patterns, law enforcement efforts against the

criminal organizations responsible for moving heroin from Southeast Asia

into the United States have not been effective.

• The lack of law enforcement cooperation between the United States and

China continues to impede interdiction of key heroin-trafficking routes.

• Although the U.S. international heroin strategy was signed by the

President in November 1995, guidelines to U.S. counternarcotics agencies

for implementing the strategy are still under review.

The United States does not have a significant counternarcotics program in

Burma because of U.S. concerns over human rights violations by the

Burmese government and the unwillingness of the Burmese government to

yield control of the country to a democratically elected government. In

1988, the United States discontinued foreign aid to Burma, including direct

counternarcotics funding support, because Burmese military forces

violently suppressed antigovernment demonstrations for economic and

political reform and began establishing a record of human rights abuses.

Furthermore, the military regime refused to recognize the results of

national elections held in 1990 and, for decades, has engaged in fighting

with insurgent armies who represent ethnic minority groups seeking

autonomous control of territory within Burma. Some of these minority

groups control major opium production and heroin-trafficking areas.

Currently, the United States provides only limited low-level law

enforcement cooperation, such as information sharing. U.S. policy

restricts direct counternarcotics assistance until the Burmese government

improves its human rights stance and recognizes the democratic process.

In addition, the President has denied certification for counternarcotics

cooperation since 1989. According to State Department officials, there has

been no improvement in the political and human rights situation, and U.S.

policy toward Burma is unlikely to change under current conditions.

The Burmese government commitment to controlling opium production

and trafficking within its borders is questionable. After decades of conflict

with ethnic minority insurgent groups, the government has signed a

number of cease-fire agreements with them that, according to the State

Department, have prevented the implementation of any meaningful drug

enforcement operations in areas under the control of ethnic armies, thus

furthering opium production and heroin trafficking. For example, in 1989,

the government concluded a cease-fire agreement with the United Wa

Page 4 GAO/T-NSIAD-96-240 Drug Control
State Army (UWSA) in which the UWSA agreed to end its armed insurgency

and the government permitted the Wa people to have autonomous control

of their territory. Since the government ended its attempt to establish its

authority over Wa territory, the Wa have gained control of 80 percent of

the opium cultivation areas in Burma and UWSA has become one of the

world’s leading trafficking organizations. Other minority groups in opium

poppy cultivation areas have reached similar agreements with the

Burmese government.

Also, in January 1996, the Shan United Army (SUA), headed by Khun Sa, a

well-known drug lord, ended its armed conflict with the Burmese army.

Despite the potential for the government to undertake meaningful

counternarcotics efforts in former SUA-controlled territory, there has been

little substantive impact on the flow of Burmese heroin. Furthermore,

according to U.S. officials, while Khun Sa is under indictment in the United

States for heroin-trafficking offenses, the Burmese government has

granted him immunity from prosecution from drug-trafficking offenses and

has refused U.S. extradition requests. Based on these limitations, U.S.

officials told us that they are not optimistic that meaningful changes will

take place under the current Burmese military regime.

Numerous Obstacles

Impede U.S. Regional

Interdiction Efforts

Difficulties in stemming Burmese opium production are compounded by

challenges in providing a regional approach to interdicting

heroin-trafficking routes. The impact of U.S. regional interdiction efforts

to date has been limited by the ability of traffickers to shift their routes

into countries with inadequate law enforcement capability and by poor

law enforcement cooperation between the United States and China.

Although some U.S. programs in countries such as Thailand and Hong

Kong that possess the political will and capability to engage in

counternarcotics activities have achieved positive results, the problems in

Burma have limited the progress in the region.

According to DEA, each heroin producing region has separate and distinct

distribution methods that are highly dependent on ethnic groups,

transportation modes, and surrounding transit countries. From Southeast

Asia, heroin is transported to the United States primarily by ethnic

Chinese and West African drug-trafficking organizations. These

organizations consist of separate producers and a number of independent

intermediaries including financiers, brokers, exporters, importers, and

distributors. Heroin-trafficking organizations are not vertically integrated,

and heroin shipments rarely remain under the control of a single individual

Page 5 GAO/T-NSIAD-96-240 Drug Control
or organization as they move from the overseas refinery to U.S. streets.

Since responsibility and ownership of a particular drug shipment shifts

each time the product changes hands, direct evidence of the relationship

among producer, transporter, and wholesale distributor is extremely

difficult to obtain. According to DEA officials, these factors combine to

make the detection, monitoring, and interdiction of heroin extremely

difficult.

The impact of U.S. efforts to interdict regional drug-trafficking routes has

been limited by the ability of traffickers to shift their routes into countries

with inadequate law enforcement capability. (See app. II.) For example,

Thailand’s well-developed transportation system formerly made it the

traditional transit route for about 80 percent of the heroin moving out of

Southeast Asia. However, in response to increased Thai counternarcotics

capability and stricter border controls, this amount has declined to an

estimated 50 percent in recent years as new drug-trafficking routes have

emerged through the southern provinces of China to Taiwan and Hong

Kong or through Laos, Cambodia, and Vietnam. Similarly, cooperation

between the United States and Hong Kong has helped reduce the use of

Hong Kong as a transshipment point for Southeast Asian heroin, but law

enforcement weaknesses in China and Taiwan have encouraged

drug-traffickers to shift supply routes into these countries.

Limited Chinese counternarcotics cooperation with U.S. law enforcement

has compounded difficulties in interdicting heroin-trafficking routes in the

region. Chinese cooperation has become increasingly important because,

as counternarcotics efforts in other countries have achieved positive

results, DEA has noted an increase in the use of drug-trafficking routes

through China. However, the Chinese government has been reluctant to

cooperate with U.S. efforts. For example, cumbersome Chinese

requirements have delayed dissemination of counternarcotics intelligence

information from DEA to Chinese law enforcement authorities. DEA faces

difficulties in undertaking joint investigations with Chinese law

enforcement officials and assisting the Chinese in making timely seizures

and arrests in China. Further, the Chinese have been unresponsive in

providing counternarcotics information that could possibly assist DEA

investigations.

Furthermore, it is possible that the 1997 transition of Hong Kong from

British to Chinese control will further complicate U.S. regional

counternarcotics activities. The small DEA presence in Hong Kong is

currently responsible for covering counternarcotics activities in Hong

Page 6 GAO/T-NSIAD-96-240 Drug Control
Kong, China, Taiwan, and Macau. According to DEA officials, DEA is

planning to continue its Hong Kong activities from there but the Chinese

government is unlikely to approve regional coverage of Taiwan.

In March 1996, we reported that DEA had planned to open a one-agent

office in Beijing to expand its regional coverage. Even though DEA officials

remain optimistic that an office will eventually be established, to date the

Chinese government has refused DEA requests for opening a Beijing office.

As a result, DEA’s ability to assist other countries in the region in

interdicting heroin-trafficking routes opened through southern China and

Taiwan are constrained.2

In Thailand, we found that sustained U.S. support since the early 1970s

and good relations with the Thai government have contributed to

abatement of opium production and heroin trafficking. Since 1978, State

Department has provided $16.5 million of counternarcotics support that

assisted the Thai government in reducing opium production levels from an

estimated 150 to 200 metric tons in the 1970s to 25 metric tons in 1995. As

a result, Thai traffickers no longer produce significant amounts of heroin

for export. Also, law enforcement training programs funded by the State

Department and support for Thai counternarcotics institutions provided

primarily by DEA have enhanced Thailand’s law enforcement capability.

For example, using U.S. assistance, the Thai police captured 10 key

members of Burma’s SUA heroin-trafficking organization in

November 1994. The United States also provided support to establish a

task force in northern Thailand that could foster intelligence analysis and

information sharing among Thai counternarcotics police organizations.

The United States has also obtained successful counternarcotics

cooperation with Hong Kong. For example, the sharing of DEA intelligence

with Hong Kong law enforcement authorities has resulted in the seizure of

heroin shipments destined for the United States and the capture of major

drug traffickers. The U.S. and Hong Kong governments also have worked

closely to arrange extraditions of drug traffickers to the United States for

trial. Also, a bilateral agreement permits assets seized by the Hong Kong

authorities from convicted drug offenders to be shared between Hong

Kong and the United States. As of August 1995, Hong Kong had frozen or

2

According to DEA, an increasing share of Southeast Asian heroin is imported to the United States

through southern China and Taiwan. Large-scale heroin shipments, mostly from Burma, move across

southern Chinese provinces to ports on China’s eastern and southern coasts. From there, the heroin is

often shipped to Taiwan by Chinese fishing trawlers and transferred to Taiwanese vessels for

movement to the United States. Taiwan also serves as a transshipment point for heroin brought by

fishing trawlers from Thailand, usually by way of ports in southeastern China.

Page 7 GAO/T-NSIAD-96-240 Drug Control
confiscated approximately $54 million worth of drug traffickers’ assets

under a bilateral agreement. Of this amount, the seizure of at least

$26 million in assets was based on information that U.S. law enforcement

agencies provided.

U.N. Drug Control

Efforts

A key element of U.S. heroin control strategy is the increasing reliance on

international organizations, such as the United Nations, in countries where

the United States faces significant obstacles in providing traditional

bilateral counternarcotics assistance. In Burma, the United States has

been a major donor for UNDCP drug control projects, providing about

$2.5 million from fiscal years 1992 through 1994. However, we found that

the projects have not significantly reduced opium production because

(1) the scope of the projects has been too small, (2) the Burmese

government has not provided sufficient support to ensure project success,

and (3) inadequate planning has reduced project effectiveness. For

example, UNDCP created “opium-free zones” in specific parts of Wa

territory where poppy cultivation was prohibited. However, U.S. officials

told us that some farmers simply moved their planting sites to remote sites

outside project areas. Also, the Burmese government failed to provide

in-kind resources to support UNDCP activities such as civil engineering

personnel and basic commodities such as fuel and did not routinely

cooperate in granting UNDCP worker access to the project areas. Finally,

aerial surveys of project areas designated for crop reduction were not

conducted until 18 months after the projects began. As a result, UNDCP had

no way to evaluate accurately the effectiveness of supply reduction

projects because no baseline data were established at the outset.

In our March 1996 report, we stated that, despite these problems, U.S.

counternarcotics officials believed that UNDCP projects offered the only

alternatives to U.S.-funded opium poppy crop eradication and alternative

development programs in Burma. UNDCP had planned to expand its efforts

with a new $22 million, 5-year project but, according to State Department

officials, the project now has been suspended because of difficulties in

obtaining Burmese government support and cooperation, such as refusing

UNDCP personnel access and limiting UNDCP communications in some

project areas.

Page 8 GAO/T-NSIAD-96-240 Drug Control
Page 9 GAO/T-NSIAD-96-240 Drug Control
Appendix I 

Worldwide Opium Production, 1987-1995

 

1987 1988 1989 1990 1991 1992 1993 1994 1995

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

Metric Tons

Burma Afghanistan Other countries

Source: Department of State.

Page 10 GAO/T-NSIAD-96-240 Drug Control
Appendix II 

Primary Southeast Asian Heroin-Trafficking

Routes

Malaysia

Bay


of


Bengal

Beijing

Hong


Kong

Guangzhou Kunming

Burma

Laos

Thailand

Vietnam

India

China

South


Korea

Japan

Taiwan

Philippines

to the


United


States

Indonesia

Singapore

Bangkok

Pacific


Ocean

Opium Poppy


Cultivation


Region

Source: DEA.

(711223) Page 11 GAO/T-NSIAD-96-240 Drug Control
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